News

• Canada May employment change +83.1K vs 0.0K expected
• Canada building permits for May 12.0% versus -0.8% estimate
• Fed’s Goolsbee: Latest tariff threat could delay rate cuts
• US June federal budget budget +27 billion vs -11.0 billion expected
• Brazil’s Lula: If US tariffs take effect, we will reciprocate
• Trump says “we will see” on Canada tariff carve outs
• Where is this talk of Powell resigning coming from?

Markets:

• Gold up $33 to $3355
• US 10-year yields up 7.1 bps to 4.42%
• WTI crude oil up $2.14 to $68.71
• S&P 500 down 0.3%
• USD leads, JPY lags

We went into the day waiting for Trump’s letter to the EU with a higher tariff rate but it has yet to arrive. Reports late in the day are mixed with some saying there are no meetings planned for the weekend and others highlighting sticking points around agriculture and autos. All the reports highlight that any deal hinges on the whims of the President.

The market has its own ideas and they were underscored by CAD trading the past 24 hours. The loonie dropped on Trump’s surprise 35% tariff on Canada but the move was relatively small and retraced in large part from the spike highs. Similarly, BRL is only moderately down from levels before Trump’s 50% tariff announcement this week. In short, the market doesn’t believe the tariffs will happen at the Aug 1 deadline.

That’s part of the reason the euro was down just 20 pips on the day and USD/CAD up 40 pips. Also in the case of the latter, the June Canada jobs report was sparkling with strong employment growth and a surprise dip in the jobless rate.

One notable move on the day was USD/JPY as it continues to get a tailwind from a rebound in Treasury yields, fears of tariffs on Japan’s export-sensitive sectors and Japan’s upcoming lower house election. The pair was steadily bid from Asian trade as is poised to finish near the weekly highs.

Cable was also soft on the day, finishing 90 pips lower and underperforming the euro despite the tariff worries. Cable hit stops below 1.3520 and continued another 35 pips lower to the worst levels since June 22.

The US dollar side is also notable on slipping Fed rate cut hopes. The combination of stock markets at record highs, tariffs, an immigration crackdown and the budget bill are all inflationary and there is some angst about next week’s CPI report.

Have a great weekend everyone. I’m taking a few weeks off for an extended vacation but I will be back with a vengeance in no time.

This article was written by Adam Button at www.forexlive.com.

Major US stock indices are closing the day lower. For the trading week the declines today push the indices into negative territory. For the day:

• Dow industrial average fell -279.13 or -0.63% at 44371.51
• S&P index fell -20.71 points or -0.33% at 6259.75.
• NASDAQ index fell -45.14 points or -0.22% at 20585.53.

The small-cap Russell 2000 fared the worst today with a decline of -28.58 points or -1.26% at 2234.82.

For the trading week:

• Dow industrial average fell -1.02%
• S&P index fell -0.31%
• NASDAQ index fell -0.08%

The small-cap Russell 2000 fell -0.63%

Some winners this week included:

• ETH/USD: +19.73% – Strongest performer; Ethereum surged as crypto sentiment improved.

• SoFi Technologies: +14.22% – Continued momentum in fintech space.

• Nio A ADR: +11.40% – Strong rebound in Chinese EV sector.

• Delta Air Lines: +11.38% – Travel demand and earnings optimism boosted the stock.

• Moderna: +10.33% – Biotech rally lifted Moderna despite daily weakness.

• Bitcoin Futures: +9.57% – Crypto strength lifted futures contracts sharply.

• Tapestry: +9.12% – Fashion and luxury retailer posted solid gains.

• Southwest Airlines: +8.95% – Part of broader airline recovery.

• BTC/USD: +8.92% – Bitcoin tracked higher on macro and ETF enthusiasm.

• Grayscale Bitcoin (BTC): +8.09% – Benefited from BTC’s strong performance.

• MicroStrategy: +7.57% – Heavily BTC-linked; tracked crypto strength.

• Dollar Tree: +7.27% – Discount retail held strong amid consumer resilience.

• United Airlines Holdings: +6.44% – Gains on the week despite sharp daily drop.

• AMD: +6.18% – AI chip momentum continues to support the stock.

• Palantir: +5.76% – Modest tech rally pushed Palantir higher.

• Occidental: +5.73% – Oil names gained with crude strength.

• Boeing: +5.03% – Recovery in aviation sector supported the stock.

Some losers this week include:

• Raytheon: -17.17% – Biggest drop of the week; no daily move Friday but major weekly underperformance.

• First Solar: -12.21% – Sharp pullback in solar stocks after recent strength.

• Chewy: -7.99% – Continued weakness in online retail and pet-related names.

• Palo Alto Networks: -7.14% – Cybersecurity sector under pressure this week.

• CrowdStrike Holdings: -6.94% – Tech pullback hit cybersecurity names hard.

• PayPal: -6.83% – Fintech weakness and growth concerns weighed on sentiment.

• Zoom Video: -6.59% – Ongoing declines as investor interest fades post-pandemic.

• Fortinet: -6.26% – Security sector broadly down despite strong fundamentals.

• Intuitive Surgical: -6.00% – Health tech pulled back from recent highs.

• Block (Square): -5.95% – Fintech and crypto-linked name moved lower.

• Arm: -5.90% – Chip and AI-related names cooled off from earlier gains.

• Salesforce Inc: -5.17% – Enterprise software lagged broader market.

• Nike: -4.92% – Retail and discretionary spending concerns pressured shares.

• Snowflake: -4.86% – High-growth tech names sold off broadly this week.

• Bank of America: -4.54% – Financials declined with yields and risk-off tone.

• Adobe: -4.21% – Tech weakness hit creative software stocks.

• Intuit: -4.20% – Flat on Friday but down for the week amid broad tech softness.

• Papa John’s: -4.04% – Consumer staples saw mild selling pressure.

• Walmart: -4.03% – Retail giant slipped slightly amid defensive sector selling

This article was written by Greg Michalowski at www.forexlive.com.

Canada CPI – Tuesday, July 15 at 8:30am ET
Canada’s inflation data will be closely watched, with headline CPI m/m expected at 0.2%, down from 0.6% previously. Both Median and Trimmed CPI y/y are forecast to remain steady at 3.0%, signaling a still-elevated but stable inflation environment. A softer print could strengthen the case for the Bank of Canada to consider further easing, while any upside surprise may delay those expectations.

US CPI – Tuesday, July 15at 8:30 AM ET
US inflation is also in focus and the key release for the week with Core CPI m/m and headline CPI m/m both expected to rise 0.3%, up from 0.1% last month. The y/y CPI is forecast at 2.6%, ticking up from 2.4%. A hotter-than-expected print could weigh on Fed rate cut expectations, while a softer release would support the ongoing disinflation narrative and increase the hollers for a rate cut from Pres. Trump and other government officials

BOE Gov Bailey Speaks at 4 PM Annual Mansion House Financial and Professional Services Dinner, in London. Markets will listen closely to Bailey’s comments for any clues on timing for future rate adjustments.

UK CPI – Wednesday, July 16 at 2 AM ETUK CPI y/y is expected to remain unchanged at 3.4%, keeping the pressure on the BOE as inflation stays above target. Markets will listen closely to Bailey’s comments for any clues on timing for future rate adjustments.

US PPI – Wednesday, July 16 at 8:30am ET
Producer inflation is projected to edge higher, with Core PPI m/m forecast at 0.2% and headline PPI m/m at 0.3%, both slightly above last month’s 0.1%. While not as market-moving as CPI, these figures offer insight into upstream pricing pressures. The pieces of the CPI and the PPI will have the number crunchers forecasting the PCE data to be released later in the month. That inflation measure is the favored by the Fed.

Australia Jobs Report – Wednesday, July 16 at 9:30pm ET (Thursday morning in Australia)
Australia’s labor market is expected to show a solid rebound, with 21.0K jobs added, compared to a -2.5K loss previously. The unemployment rate is expected to hold steady at 4.1%. A strong report could support the RBA’s neutral-to-hawkish stance, while a weak print may reignite easing discussions.

US Retail Sales & Jobless Claims – Thursday, July 17 at 8:30am ET
Consumer spending is expected to recover modestly, with Core Retail Sales forecast at 0.3% m/m and headline Retail Sales at 0.2% m/m, following last month’s declines. Meanwhile, unemployment claims are projected to rise slightly to 234K from 227K. The data will help shape expectations around consumer resilience and labor market conditions heading into Q3.

Other second tier data on tap next week includes:

China Data – Monday, July 14
China will release a batch of key economic figures, including GDP y/y (expected at 5.1%), Industrial Production y/y (5.6%), and Retail Sales y/y (5.2%), all showing slight deceleration from the prior month. However, New Loans surged to 1960B, up sharply from 620B, suggesting increased credit support. These figures will offer insight into the health of China’s economy and its momentum heading into H2.

German ZEW Economic Sentiment – Tuesday, July 15 at 5:00am ET
Germany’s ZEW Economic Sentiment index is expected to rise to 50.8 from 47.5, reflecting growing optimism among investors and analysts about the German economic outlook despite broader European uncertainties.

Empire State Manufacturing Index – Tuesday, July 15 at 8:30am ET
The Empire State Manufacturing Index is projected to improve to -7.8 from -16.0, but still remains in contraction territory. While less negative, this suggests manufacturing activity in New York remains sluggish. The NY kicks off the regional indices for the month

UK Labor Data – Thursday, July 17 at 2 AM ET
UK wage pressures are expected to ease slightly, with the Average Earnings Index (3m/y) falling to 5.0% from 5.3%, while the Claimant Count Change is forecast at 17.9K, down from 33.1K. This will offer an updated look at the UK’s labor market tightness and its implications for BOE policy.

Philly Fed Manufacturing Index – Thursday, July 17 at 8:30am ET
The Philly Fed Index is forecast to rebound to 0.4 from -4.0, possibly signaling a modest recovery in regional manufacturing conditions after recent weakness.

Fed Speak – Thursday, July 17 at 3:30pm ET
FOMC member Waller will speak, and markets will be listening closely for any updated views on the path of rate cuts, especially following key CPI and labor data earlier in the week.Waller has been a dove and coming after the June CPI and PPI data, his comments will be eyed for his current assessment for a policy change in July.

UoM Consumer Sentiment & Inflation Expectations – Friday, July 18 at 10:00am ET
The University of Michigan Consumer Sentiment Index is expected to rise slightly to 61.4 from 60.7, suggesting a modest improvement in consumer outlook. Inflation expectations are projected to remain steady at 5.0%, a key metric for Fed watchers.

This article was written by Greg Michalowski at www.forexlive.com.

Over at Kalshi, where you could move this market with a couple thousand bucks, the odds of Powell resigning have risen to about 19% from 14% on this bizarre letter from William Pulte at the FHFA.

In it, he cites ‘reports’ about Powell considering resigning but neither me nor anyone else can seem to find any of those ‘reports’ and certainly not in anything remotely reputable.

It’s like Pulte is trying to somehow manifest this.

This article was written by Adam Button at www.forexlive.com.

This is strange statement as it indicates there are ‘reports’ that Powell is considering resigning. But there are no reports that I can find.

Bizarrely, Pulte has been tweeting forever that Powell should resign and also foreshadowed this statement, even though it’s presumably based on ‘reports’.

I’m not sure what to make of this but markets don’t appear to be moving at all.

This article was written by Adam Button at www.forexlive.com.